Seeking Alpha

Eliot Murray

 
View as an RSS Feed
View Eliot Murray's Comments BY TICKER:
Latest  |  Highest rated
  • Hysterical Selling Makes Buying Ebix Compelling [View article]
    Ken, I agree with your general sentiment, as I myself am a patient value investor willing to wait on price following value. In fact I just placed an order this morning. I'm merely trying to flesh out the specific short thesis, because as I see it, the majority of the short thesis was based on the Class Action and the SEC investigation. If both are indeed behind us now, it would seem the short sellers are really 'up a creek' now and the only thing keeping the share price under $20 is time. And if it doesn't jump immediately, I'm fine with it, I'm merely perplexed that there is still even a short thesis out there...

    CT Programmer, good point about the 15% in 15 days. That's a lot of movement in a short amount of time. I had not actually done the math on that, but it would seem that the short case is losing quickly...
    Jun 19 11:10 AM | Likes Like |Link to Comment
  • Hysterical Selling Makes Buying Ebix Compelling [View article]
    Ken, thanks for the article. I have been keeping an eye on EBIX and the developments of their legal proceedings. It now seems that the Class Action is behind us, and there have been no new updates on the SEC investigation either. The stock in my opinion is worth at least $25-$30. Why didn't the stock move quickly back to around $20 after the news about the Class Action dismissal came out this month? IMO there is nothing holding it back now... is it the shorts?
    Jun 19 08:53 AM | Likes Like |Link to Comment
  • Markel: Baby Berkshire Is On Sale [View article]
    Paul Wagner, because they've compounded their BV by 16%/yr for the last 2 decades, that's why.
    Oct 28 01:03 PM | 1 Like Like |Link to Comment
  • Markel: Baby Berkshire Is On Sale [View article]
    You're welcome! If your thesis on the Fed is true, then any tapering would serve as a catalyst for MKL.
    Oct 24 12:52 PM | 1 Like Like |Link to Comment
  • Markel: Baby Berkshire Is On Sale [View article]
    Thanks for the compliment. Not sure if the decision to split or not could be labeled "wise" or "foolish". It's simply a decision mgmt made. They probably have arrived at the same conclusion that BRK.A, AAPL, and GOOG have; and that is that splitting stock only serves to create more volume and volatility and creates value for only those that make money on trading commission.
    Oct 24 12:50 PM | 3 Likes Like |Link to Comment
  • Markel: Baby Berkshire Is On Sale [View article]
    Thank you for the compliment. Yes, I'm actually curious about your question on unpaid losses as well. The one thing I can think of is that unpaid losses are heavily subjective and based on many managerial assumptions. Markel is traditionally (and refreshingly) very conservative in their reserves, so maybe Gayner's point is to not count this into the equation. Further, I think the reason for this may be that these unpaid losses on the balance sheet have already been debited on the income statement and therefore have already been reflected in the financial results in prior periods, so that the actual cash "payment" is just a follow-through on what has already been recorded. So it would be double-counting, in a sense (not sure, but I'm speculating on Tom Gayner's reasoning).

    One thing to note that I didn't include in the article is leverage. With Alterra's investments now included with MKL's, Gayner will have significant leverage with which to grow book value. Investments stand at $14.5B (Gross) currently, and SH Equity of $6.3B. If Gayner can compound those investments at 10% per year, that would mean a 23% growth in book. This is fundamental to the thesis above and should have been included.
    Oct 24 12:45 PM | 3 Likes Like |Link to Comment
  • Oracle: 40% Upside And More For Patient Investors [View article]
    Christopher, thanks for your comments.

    I mention in the article that the best case is probably not realistic. Is it possible? Of course. Probable, no. The base case FCF CAGR is actually better for the last ten years than it is since 2009, so I consider the use of the smaller growth figure to be conservative. In the end, do we know what the growth will be? No, but the mechanics of a DCF model require that input.

    It seems that for every article I write, I get the same arguments about 1) discount rate and 2) organic growth. And I continue to disagree. No one has been able to convince me why only organic growth rates should be used, as if growth via acquisitions were some sort of "second class" cash flow. Where would Warren Buffett be today without the growth through acquisitions? If I were to value Berkshire in the 1970s, 80s,90s, would i only value the textile business? Of course not! wouldn't I value the company based on quantitative factors in addition to the fact that it had the BEST capital allocator in the world at the helm? Ellison has proven to be a good capital allocator through the years and I'm simply basing my valuation on those facts.

    Discount rate: I admit looking at a discount rate of 10% in a vacuum looks low, but I use the same discount rate across all my valuations, thereby regulating the discount rate to what it truly is: a measuring stick. At the very most, a hurdle rate. Using different discount rates across different asset classes only serves to muddy the waters of valuation. Why should one stream of cash flows be discounted at a different rate than the next? It is not a risk offset. That's what MOS is for.

    As stated in the article, margins will expand as revenue from renewals becomes a larger percentage of the total.

    I'm switching valuation methodologies simply because of time and real estate. I could've easily written another 1,000 words and clearly spelled out each methodology and scenario, but I think the readers and the editors both are educated enough to get the gist, and I hope they appreciate the conciseness.

    I don't agree with your law of large numbers thesis. See Berkshire, Microsoft, Apple, etc. All 3 have growth ahead and are much larger than ORCL.
    Oct 19 10:40 AM | 2 Likes Like |Link to Comment
  • The 'New' News Corp.: Unwanted And Very Undervalued [View article]
    Ouissam, I know what corporate overhead is, but I didn't understand your specific questions. The overhead is included in the "Amplify and other" reporting segment.
    Sep 5 06:15 PM | Likes Like |Link to Comment
  • The 'New' News Corp.: Unwanted And Very Undervalued [View article]
    Agreed.
    Sep 4 07:45 PM | Likes Like |Link to Comment
  • The 'New' News Corp.: Unwanted And Very Undervalued [View article]
    News Corp is a multinational conglomerate. My analysis was referencing the shares as they are traded on the NASDAQ, but yes, it looks like News Corp is traded on the ASX exchange as well. Hope this helps.
    Sep 4 07:45 PM | Likes Like |Link to Comment
  • The 'New' News Corp.: Unwanted And Very Undervalued [View article]
    Ouissam, FOX will indemnify NWSA for NOTW: http://on.mktw.net/1cH...

    I'm not sure what you mean by "corporate overhead".
    Sep 4 07:39 PM | Likes Like |Link to Comment
  • Ithaca Energy: Strong Growth But Deeply Undervalued (For Now) [View article]
    Excellent first article, Dennis. Thanks for posting.
    Aug 29 09:56 PM | Likes Like |Link to Comment
  • Aflac: An Undervalued Market Leader [View article]
    I'm not talking about the market. I'm talking about the stock. Aflac is a better company than it was in 2008, therefore it deserves a higher multiple. That's all I'm saying.
    Aug 19 12:24 PM | 1 Like Like |Link to Comment
  • Aflac: An Undervalued Market Leader [View article]
    Thank you Ray, for the compliments. And thanks for the added data that illustrates Aflac's great business model.
    Aug 16 12:00 PM | Likes Like |Link to Comment
  • Apple's Institutional Slingshot: Rational Explanation Of Irrational Stock Action [View article]
    Interesting article. Thanks for sharing.
    Nov 17 09:17 AM | Likes Like |Link to Comment
COMMENTS STATS
32 Comments
19 Likes